Real estate industry, the second-largest sector to generate employment in India, contributes 7.8% to the country’s GDP. The sector comes second only to the IT sector. The new Goods and Services Tax (GST) bill passed in the Rajya Sabha’s monsoon session of 2016 brought along prospective positive growth opportunities for the real estate.

Radiant Structures, a leading realty player in Bangalore, discusses the importance of the GST bill in the real estate sector.

What does the GST model bill say?

Applicable from April 1 next year, the GST will work as a centralized or a single tax that will substitute multiple indirect taxes, such as excise duty, VAT and CST. This uniform indirect tax is aimed at streamlining the entire taxation process. Realty experts say that the GST bill is effective in bringing transparency, dropping the cost of property and shooting the demand in the real estate sector.

According to the model GST law, registered real estate developers won’t have to pay the input tax credit against the total purchases. This is because the end product made utilizing the goods and/or services is an immovable possession.

Decrease the high rate of stamp duties levied on property-purchasing formalities, such as booking and development agreements.

Rationalizing of several duties and taxes will decrease the extra dues imposed on a piece of land.

Real estate players will enjoy free input credits on the GST paid by them for buying goods and services. This will reduce the cost of property for buyers.

Reduce the overall taxation cost for commercial property as well.

Help in serious money saving.

Infuse transparency into the slow and dark bureaucratic processes.

The property buying process will speed up, benefiting the common man, the investors and the developers alike.

Expected to increase the GDP by 2%, GST will prove to be a boon to the real estate industry in the long run. The important GST regime with a holistic approach is likely to improve the economic environment of the country, supporting the vision of creating housing for all by 2022. Visit http://radiantstructures.in/ to know more about the latest realty trends, policies and projects.